Spending Review unlikely to start before summer, says Truss

5 Jun 19

The Spending Review is unlikely to start before parliament’s summer recess, chief secretary to the Treasury Liz Truss has told the Lords economic affairs committee.

She said this was because of “goings on within the Conservative Party” – referring to the current leadership race to replace Theresa May, who resigns on Friday.

“The plan had been to launch the Spending Review…just before the summer recess,” Truss told the Lords.

“I would suggest that’s unlikely to happen given the current timetable for the Conservative leadership election, and in fact although we will need to set revenue budgets (for 2020-21) we do already have capital budgets for 2020-21,” she said.

The announcement comes after chancellor Philip Hammond said in April that he thought it would be “unwise” to set a three-year Spending Review before the outcome of Brexit was clear.

Truss claimed that the Treasury had already started preparatory work by writing to departments asking for their capital bids.

When questioned on whether the government would continue with HS2, she said that “for the first time” the Spending Review will consider the “deliverability” of projects as well as making an economic assessment.

Truss noted that decisions on the next phase of HS2 would need to be made by the next prime minister but said that the government could prioritise other projects over HS2.

“We will be looking at [deliverability] for all projects, because I think one of the issues in previous Spending Reviews is that promises have been made that haven’t been kept,” she added.

Asked about the Treasury’s plan for local government in the Spending Review, Truss said the department would look at making the sector sustainable in the future.

“Clearly there are pressures on local government, and one of the things we did in the local government settlement last year was put an extra £650m in specifically because of the issues around adult social care and children’s services,” she said.

Truss added the government was looking at how it ensures local government is sustainable in the future. 

Truss claimed “part of the answer” was greater devolution, echoing a plea she made earlier this year for councils to be given more power.

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